Last updated on September 16th, 2022 at 06:06 pm
I invest way too much time into TikTok. Like, an alarming amount of time.
I can’t help myself. What started out as a way to have a quick laugh morphed into a never-ending stream of insight (sprinkled with the occasional Encanto reference… we don’t talk about Bruno).
And the more I consumed the bite-sized nuggets of business breakdowns and entrepreneurial entertainment, the more I was rewarded with more of the same.
And through the barrage of side hustles, affiliate marketing, drop shipping, and money making opportunities that get shown to me daily, I’ll oftentimes find myself being served insight into some of the largest players on the planet. Like this one about Starbucks.
Do big businesses have side hustles?
The idea of Starbucks being a bank is not new, but the breakdown in this particular TikTok made it way more tangible since it was less than :60 and chock full of insight.
The short of it — We love convenience. We’ve got entertainment at our fingertips, delivery in hours, and can pay with our phones. Starbucks knows that. They also know that a Starbucks gift card is the perfect gift to give when you don’t know what to give (that explains the more than $3B spent on Starbucks Gift Cards in 2020).
So, the idea that you could order and pay for a ‘venti upside down half-caf breve cappuccino’ from your phone, then pick it up without having to risk missing the opening whistle to your kids soccer (yes.. soccer, I’m from the U.S., give me a break) game or your 6:17am Amtrak from Bridgeport, CT into the city, gave way to a huge opportunity.
Here’s where they capitalized on it though. Once you connect your payment method to the app and set a minimum threshold to reload, your bank is auto-pumping your money right into Starbucks’ coffers and the only way to access it is to buy another drink.
It’s brilliant. And, in recent years, it’s led to an annual $1.5B interest free loan in balances that Starbucks can utilize however it wants — investment, expansion, building a money pit for Scrooge McDuck to swim around in.
We’ll come back to what that means for your business or side hustle, but first let’s jump into one of the nation’s largest landlords. The home of the Big Mac, king of the upsell, and provider of more than $140M in annual charitable donations — McDonald’s.
Back up… landlord?
If you saw The Founder in 2016, you likely already knew this. If you’re addicted to TikTok like me, you likely saw this in any number of minute-long breakdowns like this one.
“You don’t build an empire off a 1.4% cut of a 15 cent hamburger, you build it by owning the land on which that burger is cooked.”Harry Sonneborn to Ray Croc
In the eyes of potential franchisees McDonald’s was giving them the chance to own the American dream. While this is true, McDonald’s was simultaneously building dependency. If you bring the only basketball to the court, then you’re going to get to play. To expand upon the metaphor though, McDonald’s doesn’t just bring the basketball, but the entire court. And then charges you for it.
Their ability to cause dependency has led to a $30B real estate holding that generates $4.5B in annual profit (note: that’s 46% of their total profit).
Okay, we get it. We get it. These MASSIVE corporations have figured out ways to drive up profits….
What does this have to do with your side hustle?
Simple —convenience and dependency.
Starbucks capitalized on convenience by making it unbelievably simple to get your caffeine fix. McDonald’s capitalized on dependency by ensuring you had to rent from them in order to franchise.
You can capitalize on both for your business. And are missing out on a massive opportunity if you aren’t.
Look at your offering and determine where you can make it simple and sticky. Not the marketing around your offer, but the offer itself. Simple and sticky.
For example, let’s say your side hustle is affiliate marketing for tech companies like ConvertKit. This is a great affiliate partner because they pay commissions for the lifetime of the client. Making success simple allows you to capitalize on the stickiness that comes from building while using specific SaaS products.
So what do you do? Look at your offering. Look at the gaps that your offering has created. Then fill those gaps to make getting started and seeing success convenient. From there, look at what causes dependency. Perhaps it’s from integration within the specific platform you’ve marketed. Or access to a select community. Or through added value content that they can only access for as long as they are still a paying customer. You get the point.
There are THOUSANDS of ways to do this across THOUSANDS of products within every niche imaginable. Let me know if you do or find anything particularly interesting. Then we can geek out on this stuff together.